Decision upholds scrap sales as operating revenue and confirms domestic PLR benchmarking for FCCDs under ALP rules Section 92(1)

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....The ITAT affirmed that receipts from sale of scrap arising from manufacturing operations and from unpacking imported raw materials constitute operating revenue, and reversed the TPO's reclassification of such receipts as non-operating merely because they were shown as "other income" in the financial statements; the CIT(A)'s treatment of the scrap proceeds as operating income was upheld and directed to be given effect. The ITAT further held that FCCDs denominated in Indian currency are to be benchmarked to domestic PLR for ALP determination; the TPO was directed to adopt the average SBI PLR as the comparability rate, and interest paid at 13.50% p.a. was held to be at arm's length against a domestic PLR of approximately 14.46% p.a.....